All Forum Posts by: Maria D'Aura

I've had investments in Silicon Valley and Tri-Valley areas. They were great for appreciation, but terrible for cashflow. A few years ago I 1031 to multifamily properties about 50 miles away. Half of them I self-manage. I was looking for cash flow and wasn't expecting any appreciation, but they've appreciated as well. I've been very happy with the move and considering doing it again because I can double my cash flow doing a 1031 from a Bay Area property, but still be close enough to self-manage. I've helped several Bay Area clients buy investments in the same area as well. Message me if you want more specifics. Happy to share. 

What is "all the work" you have done so far? Finding the property is not really ALL of the work if you don't know what the next step is. For me, the actual work is what happens after finding the property, which oftentimes buyers and sellers don't really see happening. Also, as Bill already pointed out if it's already listed on the MLS the seller has likely already agreed to pay for a buyer's agent.

 Tracie - Your comment about pension and speech-language pathologists caught my attention. I'm planning a trip to St. Louis in a few months to attend my cousins graduation from a masters program in speech-language pathology. I've helped him with investments in STL and I'm just curious if pensions in the field are common. He may already be aware, but if it's not common in the field I'd love to share some details with him about finding work in the field with pension potential. Message me if you don't mind sharing. thanks

 I like your thinking. I'm in Livermore now, moved from Mountain View. Not sure how much over $1 million equity you have, but sounds like you might be able to get into a new primary in Livermore with a healthy downpayment for an investment property. If you goal is cash flow look a bit further east for the rental property if you want to keep it near by.

I was at a similar decision-making point as you a couple of years ago. I had a single property rental in Silicon Valley and one in the Tri-Valley that were cash-flowing, but not by much. I sold one and did a 1031 into a 4-plex in Modesto. I felt I had already benefited from the appreciation and now it was time to benefit from more cash-flow. It worked out and I was happy with the decision. So I did it again and did another 1031 from 1 rental into 2 duplexs' in Modesto. Same result. They're not appreciating as much which is to be expected, but the cash-flow is significantly more. No regrets. I'd do it all over again. In fact... I might do it again with the last Bay Area rental we have, but not in a hurry. I had also considered investing out of state in Saint Louis, which I may still do. I haven't written off that idea yet, but for now my comfort zone is 1 hour from the Bay Area, although it's extremely rare that I ever personally visit one of my properties. 

The 132% is making for a great headline, but you have to put it into perspective and not ignore the second part of the sentence. "from a year ago". Mortgage delinquencies have been down. Foreclosures have been down. During the pandemic when there was a hold on foreclosures it was reported that many people had caught up on payment and were no longer in foreclosure long before the foreclosure moratorium was over. 

Black Knight's March 2022 mortgage data report makes these key points... see the full report here: https://www.blackknightinc.com/black-knights-first-look-at-march-2022-mortgage-data/?&

• -The national delinquency rate dropped by more than half a percentage point in March, falling to 2.84% and shattering the previous record low of 3.22% in January 2020
• -While March typically sees the strongest mortgage performance of any month – with delinquencies falling more than 10% on average over the past 20 years – this year’s 15.5% reduction was exceptionally strong
• -Robust employment, continued student loan deferrals, strong post-forbearance performance and millions of refinances into record-low interest rates have all helped put downward pressure on delinquency rates
• -The strongest improvement was seen among borrowers who are a single payment past due, with 30-day delinquencies recording a 20% month-over-month decline
• -Though serious delinquencies – those 90 or more days past due but not in foreclosure – fell 12% for the strongest single-month improvement in 20 years, they remain 70% above pre-pandemic levels
• -Despite elevated serious delinquencies, foreclosure starts fell by 3% from the month prior and are holding well below pre-pandemic levels
• -The number of active foreclosures edged slightly higher in March, marking the first year-over-year increase in almost 10 years, though inventories also remain well below pre-pandemic levels
• -Prepayment activity bucked the recent trend of sharply rising interest rates driving falling prepay speeds, rising by 9% in March, likely driven at least in part by seasonal increases in home sales-related prepays

When evaluating tenant applications what minimum requirements do you have? 

To qualify for a mortgage debt to income is talked about a lot, but not so much for renters. Do you take that into consideration? 

Thanks everyone for your input. Very helpful.

Since posting I did hear back from the tenant and I do believe we will get to a resolution.